COVID-related aid available to small businesses

A new set of emergency grants and loans is now available to small businesses that have experienced financial hardship as a result of the COVID-19 pandemic.

Sponsored by Rep. Zack Stephenson (DFL-Coon Rapids) and Sen. Paul Anderson (R-Plymouth), a new law will provide $62.5 million for small-business grants and loans -- $60 million from a federal coronavirus relief bill and $2.5 million from the Department of Employment and Economic Development’s Emergency Loan Program.

The law will make grants of up to $10,000 available to small businesses that have experienced financial hardship as a result of the COVID-19 pandemic and meet certain requirements.

The grants will be evenly split between the Twin Cities metropolitan area and Greater Minnesota and ultimately determined by a lottery. There will be specific, minimum carve-outs, including:

• $18 million for microbusinesses with six or fewer full-time employees;

• $10 million for minority-owned businesses;

• $2.5 million for women-owned businesses;

• $2.5 million for veteran-owned businesses; and

• $2.5 million for cultural markets, in part to cover rent-forgiveness for existing tenants.

The law, which took effect June 19, 2020, also includes a requirement that the Minnesota 21st Century Fund for projects in the taconite relief tax area be repaid whenever the state has a surplus. It also makes changes to the fund receiving small business loan repayments.

By Dec. 31, 2020, the Department of Employment and Economic Development must file a report on these small business relief grants to legislative committees with jurisdiction over economic development policy and finance.

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